FinCanna Forges Ahead in California’s Licensed Medical Cannabis Market
The cannabis industry has experienced tremendous growth over the past couple of years. According to Cowen & Co., the U.S. industry could exceed $50 billion over the coming years as more states liberalize their marijuana policies. Medical marijuana enjoys the broadest support across the political spectrum as researchers continue to uncover new ways that cannabinoids can help address serious medical conditions.
For investors looking to get involved in the more ethical side of the business, FinCanna Capital Corp. (CSE: CALI) represents a compelling opportunity in the form of a royalty company specifically focused on the legal medical cannabis market. The company recently went public on the Canadian Securities Exchange (CSE) and raised C$14 million to invest, among things, in a ground breaking licensed medical cannabis campus to be developed in Coachella, California. The medically-focused approach could help avoid some of the issues that could face the recreational side of the industry moving into the new year.
Sessions’ Surprising Memo
United States Attorney General Jeff Sessions surprised the legal cannabis industry by rescinding the Obama era Cole Memo that helped pave the way for state-wide legalization. While the new memo does not implement any changes to federal law, it removes previously non-binding guidance issued to U.S. attorneys and reinforces that federal prosecutors should exercise their discretion in determining whether to prosecute recreational cannabis-related violations of U.S. federal law.
“Based on the nature of the memo from Sessions and the public response from several U.S. attorneys, we don’t expect any real impact on the growth potential of the licensed medical cannabis industry operating legally under state laws and the companies in which we seek to invest,” said FinCanna Capital CEO Andriyko Herchak. “We will continue to pursue our business strategy of investing in best-in-class businesses in the licensed medical cannabis industry that operate in full compliance with all state laws and local regulations.”
FinCanna Capital and many other industry experts believe that the Sessions memo could actually pave the way to greater progress. In particular, the memo could create an impetus for members of both political parties to unify in efforts to create a clear federal policy further in support of the licensed medical cannabis industry.
Moving Forward with Medical Cannabis
FinCanna Capital remains focused on identifying investment opportunities within the licensed medical cannabis industry. With a focus on California’s market, the company’s flagship investment is in Cultivation Technologies Inc. (CTI), which plans to construct a 111,500 sq. ft. facility in Coachella, California. The facility will include 81,600 sq. ft. of cultivation space, a 9,000 sq. ft. extraction and manufacturing center, and 26,300 sq. ft. for activities such as testing and distribution.
Under the terms of its investment, FinCanna Capital will receive a royalty worth 10% of CTI’s revenue from the Coachella facility in exchange for an investment to bring the project to life. FinCanna Capital is also entitled to receive 50% of the profits from CTI’s interim medical cannabis extraction facility, which is currently in operation and is capable of processing an estimated 6,000 pounds of biomass per month and can yield approximately 3.7 million grams of raw oil each year – a significant amount by any measure.
The company recently went public on the Canadian Securities Exchange under the ticker symbol “CALI” after raising approximately C$14 million in capital. With a significant amount of capital in its coffers and the potential for near-term revenues from CTI and royalties from future potential investments, the company is uniquely positioned to generate value for shareholders. Management is committed to building its portfolio of investments by sourcing and funding additional top-tier companies and projects operating in the licensed medical cannabis sector in exchange for royalties.
FinCanna Capital Corp. (CSE: CALI) represents a unique investment opportunity in the licensed medical cannabis industry. While the Sessions memo was a surprise, the management team is confident in the industry moving forward given its focus on licensed medical cannabis versus recreational marijuana. Investors may want to take a closer look at the stock given anticipated revenues from CTI along with potential royalties from additional investment opportunities that are aligned with the current legislative environment in the United States.
For more information, visit the company’s website at www.fincannacapital.com.
Written by Ryan Allway for CFN Media Group